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European and Americas Corporates Prioritise Regions Close Home for Growth in a Time of Uncertainty but Expansion into New Markets Remain Key with Asia Pacific Ranked Top

NEW YORK, September 1, 2020 — New research[1] published today by Standard Chartered Bank reveals that while corporations in Europe and the Americas are prioritising their home regions of Europe (84%) and North America (74%) as a source of growth, Asia Pacific (55%) remains a target for their international expansion strategies. Other regions of interest include South America (38%), Middle East (32%) and Africa (17%)*.

The survey explored how international expansion remains a key priority for corporations of all sizes and industries to diversify and grow their business. It also delved into CFOs’ and treasurers’ ambitions, concerns and goals as they help their organisations pursue new geographical areas of growth.

The COVID-19 pandemic has reshaped many organisations operating and strategic priorities in the Americas. This is reflected in how close to half (49%)* Americas respondents indicated that managing the sustained impact of COVID-19 as one of their top three challenges.

When looking at liquidity issues, 23%# of Americas businesses indicated lower than anticipated revenue as a management challenge overseas when asked. This was followed closely by supply chain failure and disruption (21%)#.

Over the next six to twelve months, Americas companies highlighted the need to diversify their suppliers outside of their home region (37%)# as the top priority. This reflects how many companies recognize the need to increase resilience and flexibility in their supply chains in response to the challenges experienced from the pandemic.

Beyond COVID-19, Americas respondents ranked the ability to understand and comply with local regulations on growth outside the home region as the top challenge of international expansion (32%)#. This unfamiliarity may suggest why only 13%* of Americas businesses listed Africa as a top three potential growth market – especially when considering the growth potential of the region.

When it comes down to financing international growth, Equity capital markets (76%), bank borrowing (63%) and venture capital (63%)* are the top three preferred choices of Americas respondents.

Counter to expectations, only 3%# of the respondents in the Americas ranked environmental, social and governance (ESG) criteria and sustainability issues as their top supply chain priority. This could be down to the responsibilities for ESG elsewhere in the organisation, or a view that ESG and sustainability objectives are inherent in the business culture.

“Around the world, companies’ experience of the COVID-19 crisis has inevitably reshaped their priorities and the way they address challenges,” said Torry Berntsen, Chief Executive Officer, Americas and Regional Head, Corporate and Institutional Banking at Standard Chartered Bank. “As businesses explore expansion opportunities, the growth potential of emerging markets such as Africa should not be ignored. Some of the most commonly perceived challenges can be readily overcome with a trusted partner.”

— ENDS —

About the report

The research was conducted between 25th May – 5th June 2020. Three hundred respondents participated, equally split between Europe (UK, Ireland, France, Germany, Turkey, Sweden, Denmark, Finland, Norway) and the Americas (US, Canada, Brazil). Responses were restricted to:

  • CFOs and finance directors (30%) and regional/ global treasurers (70%)
  • $500m turnover upwards, of which 28% had a turnover above $1bn
  • Non-financial corporations. Manufacturing (19%) and healthcare (14%) and technology (10%) were the biggest industry participants.

About Standard Chartered

We are a leading international banking group, with a presence in 60 of the world’s most dynamic markets and serving clients in a further 85. Our purpose is to drive commerce and prosperity through our unique diversity, and our heritage and values are expressed in our brand promise, Here for good.

Our history in the US dates back to 1902, and we are currently present in eight locations throughout the Americas. Our Americas franchise focuses on financial institutions and select corporates and plays a key role in facilitating trade and investment flows between the Americas and Asia, Africa, and the Middle East.

Standard Chartered PLC is listed on the London and Hong Kong Stock Exchanges.

For more stories and expert opinions please visit Insights at Follow Standard Chartered on Twitter, LinkedIn and Facebook.

[1] Borderless Business: Grow in the fastest growing markets. See Notes to Editor for further detail.

* Ranked when prompted to pick top three

# Ranked when asked to pick one